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A Bureau of Indian Affairs violation of the Antideficiency Act in fiscal year 1977 was an overobligation of at least $186,000, but perhaps as much as $13 million. It was not reported to the Office of Management and Budget and to Congress as required by law, and because problems permitting the violation prevailed throughout most of fiscal 1978, the Bureau may have had another Antideficiency Act violation that year. The Antideficiency Act was violated when the Bureau exceeded its fiscal 1977 obligational authority for the operation of Indian programs appropriation.

In attempting to alleviate the overobligation and avoid requesting a deficiency appropriation, the Bureau made a series of questionable adjustments. It dropped hundreds of valid obligations from the records and transferred many of them to the fiscal 1978 appropriation. An unsupported adjustment of $300,000 was made so that the Bureau's report on obligation status would show an unexpended balance. In this way, many unrecorded but valid field offices' obligations found after yearend could be included in the Bureau's records without showing an overobligation. The Bureau should have sought a deficiency appropriation to cover obligations for these costs. The actions to shift the fund shortages unnecessarily increased the Bureau's administrative costs. Two factors contributed to the Bureau's violation of the Antideficiency Act: (1) its budgeting and fiscal reporting systems did not contain controls to keep obligations within amounts specified in appropriation acts, and (2) extensive delays in recording obligations made it necessary to record numerous valid obligations after the books were initially closed for fiscal 1977. Both fund control problems have persisted for years in the Bureau's financial system. Measures to prevent overobligations may have resulted.

Recommendations for Executive Action

Status: Closed - Not Implemented

Comments: This recommendation was made to ensure that the Bureau properly accounted for money by fiscal year after the violation. This requirement is only for a 2 year period; then unliquidated obligations are transferred to merged accounts in which funds are available without regard to fiscal year designation. The Bureau said it performed the recommended review on its 1980 appropriations, but it did not.

Recommendation: The Secretary of the Interior should have the review completed on the current year closing to make certain that fund shortages related to the violation are not shifted to future years' appropriations.

Agency Affected: Department of the Interior

Status: Closed - Not Implemented

Comments: The Bureau has not revised its accounting system as promised. However, GAO has made essentially the same recommendation on September 8, 1982, in a similar report.

Recommendation: The Secretary of the Interior should ensure that the Bureau redesigns its accounting system to include appropriate fund controls and submits the revised system to GAO for approval as soon as practicable.

Agency Affected: Department of the Interior

Status: Closed - Implemented

Comments: When we confirm what actions the agency has taken in response to this recommendation, we will provide updated information.

Recommendation: The Secretary of the Interior should require the Bureau to use its planned interim aproach to validate fund availability until the redesigned system is operational.

Agency Affected: Department of the Interior

Status: Closed - Implemented

Comments: When we confirm what actions the agency has taken in response to this recommendation, we will provide updated information.

Recommendation: The Secretary of the Interior should make sure the violation is reported as soon as practicable to the President and Congress as required by 31 U.S.C. 665(i)(2).